Rising Bond Yields Could Send $250 Billion Into Equity Funds

A sustained recovery in US 10-year bond yields to 2.5% could drive a rotation of $250 billion from developed market bond funds into developed market equities according to proprietary analysis from Deutsche Bank.

• HSBC Reaches For Yield, Likes What It Sees In India, Russian Sovereign Bonds

• Dalio Warns That Bond Investors Could Be Wiped Out

This forecast was published in the bank’s weekly fund flows research note, which is published at the beginning of every week and this week features a detailed analysis of bond-equity rotations.

Rising Bond Yields Could Send $250 Billion Into Equity Funds

Data compiled by the bank’s analysts shows that there have been four major developed market bond-stock rotations since the beginning of 2007. The first took...